G8 communique supports improved mandatory reporting by extractive companies for the first time
In today’s communique from the summit in Deuville, the G8 endorsed mandatory requirements for extractive companies to disclose payments to governments for the first time. The G8 includes Canada, France, Germany, Great Britain, Italy, Japan, Russia and the United States.
“The G8 wants oil, gas and mining companies to report the payments they make to each and every government,” said Vanessa Herringshaw, director of RWI’s London office. “That is real progress toward allowing citizens to track how their governments use that money. The G8 leaves the door open for voluntary as well as mandatory approaches. But more and more governments realize that transparency is vital to cutting corruption and ensuring the stability of supply of these vital resources, and this cannot be left to voluntary approaches alone.”
The G8 announcement reinforces steps taken by the U.S. Congress, which in 2010 passed legislation requiring companies registered with the Securities and Exchange Commission to report the amounts they pay to governments, country-by-country and project-by-project, for access to oil, gas and minerals. This promises investors and citizens new tools to hold companies and governments accountable.
This opens the door to the European Union and the G20 to promptly press for new rules for greater public disclosure of payments by oil, gas and mining companies to governments.
The president of the European Commission, Manuel Barosso, has already pledged to issue legislative proposal for mandatory disclosure of payments.
“We commend European members of the G8 pushed for requiring county-by-country disclosures by companies,” Herringshaw said. “In setting its own rules, the EU itself must also help shine light on whether countries are getting a fair share from their extracted resources. This requires company reporting of information in addition to payments, on a country-by-country basis, to show where profits are generated and whether companies are paying what they should.”
Other important steps fall to the G20. “The G8’s decisions should encourage the G20 to endorse greater transparency,” said Karin Lissakers, director of Revenue Watch. “Economies such as China, Brazil, India and South Africa are vital to the oil, gas and mining industries, and there is a clear opening for their leadership.”
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